UK asking prices fall 9%, says RICS

The average UK asking price has fallen 9%, reveals a report from the Royal Institution of Chartered Surveyors.

In the North sellers are being forced to accept as much as 12.5% discount off their advertised price – the greatest drop in the UK.

RICS says that as economic fundamentals continue to worsen the gap between selling and asking prices is widening.

Vendors in the North West, East Midlands, West Midlands and Wales are accepting offers averaging approximately 10% below while in London the figure stands at 8.5%.

London has remained firmer than most as its diverse economy and large job market offers sellers more room for optimism.

RICS says Scotland has yet to be affected with the average property having dropped only 2.4% but it says it is likely that the gap will widen in the coming months.

Simon Rubinsohn, chief economist at RICS, says: “With housing transactions currently at a 30 year low, many vendors are being forced to lower their asking prices to achieve a sale in an ever shrinking market or they are being forced to rent their property until the market picks up.

“In recent surveys, chartered surveyors have reported that some buy-to-let investors are re-entering the market to take advantage of rising yields.”

Rubinsohn says that predatory buyers are contributing to price drops as many have been hovering over the stalling market to take advantage of desperation while others are cut out by the lack of mortgage liquidity.

He adds: “The gap between asking prices and selling prices could widen in the coming months as the downturn in the economy becomes more visible.

“The London market could be adversely affected as employment in the financial sector drops off.”